The Fiscal Responsibility Commission on Sunday in Abuja, bemoaned the delay in submission of budget monitoring reports by the Budget Office of the Federal Ministry of Finance.
The Commissioner, Policy and Standards at the FRC, Dr. Sylvester Mordi, told the News Agency of Nigeria that the delays made it impossible to monitor budget performance.
Mordi said the delays also made it impossible to correct mistakes.
He said: “The first quarter report is supposed to come in 30 days after the end of the quarter, which is April, the second one July, third one September/October, the final one January the following year.
“Based on our experience, empirical evidence, these reports are submitted on the average three months behind time so we reported that this is not good for monitoring purposes.
“The purpose of the report is to tell the people see how far we have fared, we are going into the next stage so that we can nudge the implementers to ensure that the budget is achieved.
“But if the budget comes after the subsequent quarter is finished, the report dies before it reaches Fiscal Responsibility Commission.
“It’s not an accusation.
“It is a comment.
“It is an advice.”
Mordi told NAN that the FRC was not in the habit of making accusations, but would make observations since the submission of budget reports was a provision of the Act establishing the commission.
He said that a provision of the Act demanded that the Executive, through the Minister of Finance, particularly through the Budget Office, should prepare quarterly reports on budget implementation, evaluating financial targets and submit these reports to the Joint Committee of the National Assembly and the Fiscal Responsibility Commission.
He also expressed the commission’s displeasure with the Nigeria National Petroleum Corporation over its non-submission of audited accounts.
He said that it was unimaginable that the NNPC, which operated in a lucrative sector, could claim to be making losses and as such was not returning its operating surpluses.
He said: “NNPC is still on the hook, both with the commission and the National Assembly.
“You see, NNPC makes losses from year to year.
“That’s what they claim.
“Oil and Gas, they are gold, so why should they be making losses.
“Sale of oil is a different thing from this concept of operating surplus.
“NNPC has a budget for paying for its own operation and we are saying that after paying for their operation, they should save money and from that money they should pay 80 per cent as operating surplus.
“We asked NNPC: give us your audited account.
“To date, we have not sighted one.
“We say give us your audited account and domestic report, but the finance director said he does not know the meaning of domestic report.”
Mordi explained that domestic report was a report given by an external auditor telling you to keep clean your house and so many bad things that should not be brought to the public.
He said that according to the FRC Act, all MDAs should pay 80 per cent of their net profit as operating surplus and retain 20 per cent for use.
He added: “It’s not arbitrary.
“Then when you look at them, they say they are not making profit and so on.
“But you look at the accounts, you see over-invoicing, over-pricing.
“They can say this year they paid N10 million for newspapers and next year N20 million, the following year will be N30 million, but they are reading the same newspaper.
“All done to cheat revenue.
“But we say no!
“Then they resort to all sorts of creative accounting to reduce what should go to government.
“It’s is not only NNPC.”
The Group Managing Director of the NNPC, Andrew Yakubu, had recently claimed that operational losses and harsh operating environment had made it difficult for the corporation to declare any surplus over the years.
Yakubu listed challenges contributing to the operational losses to include pipeline vandalism, oil theft and the fact that the NNPC bought crude at international rate and sold products at regulated prices.
He said: “We should like to emphasise that strictly speaking NNPC cannot be expected to sweep funds into the Consolidated Revenue Fund since the law specifically says it is surplus that should be so paid.
“In a situation where due to no fault of ours, we operate at a loss, there would not be any surplus to pay.
“Of course, we are all living witnesses to the causes of our operational losses.”
The FRC is also investigating eight Federal Government agencies for alleged violations of the Fiscal Responsibility Act.
Mordi said some of the agencies under investigation had ignored requests to submit their audited accounts to the commission.
He listed the agencies under investigation as the Nigeria Communications Commission, the Presidential Committee on sale of Federal Government houses, and the Bureau of Public Enterprises.
Others are the Nigerian Tourism Development Corporation, the Nigerian Maritime Administration and Safety Agency, the Federal Airports Authority of Nigeria, the Niger Delta Development Commission and the National Sugar Development Council.
He said: “Some have never complied with the Act ever since it (the commission) was set up in spite of requests.
“They have never complied.
“Some are short-paying operating surplus.
“Some have never paid.
“Some prepare double accounts and so many problems and that is why we are investigating and they block.
“We are still investigating.
“We have put police team and our staff on these MDAs.
“We will soon get our reports and where necessary, report the MDAs to the Attorney-General of the Federation for possible prosecutions.
“But where we are able to reconcile and accept what the MDAs are doing, there is no point for reporting.”
Mordi explained that the agencies under investigation were listed among the 31 corporations, commissions and agencies owned by the Federal Government expected to comply with the provisions of the Act.
The agencies are expected to submit their Medium Term Expenditure Framework for three years and prepare their annual budget based on the MTEF.
They are also expected to make allowances for the payment of 80 per cent of their operating surpluses into the Consolidated Revenue Fund of the Federation.
The commissioner also accused the agencies of failing to publish their financial statements in contravention of provisions of the Act.
On the presidential committee on the sale of Federal Government houses, Mordi expressed dissatisfaction that the commission had no financial record on houses sold in spite of repeated attempts to obtain same.
He said: “We queried them, they have replied but we are not satisfied and we are digging deeper.
“A major problem is that we don’t know where the money realised from these sales, including the one you mentioned, are lodged, but we are not saying that the money has been stolen or embezzled.
“But what we are looking for is give us the records so that we know where the money is because the law says if you sell government property, pay the money into government revenue.
“You can only defray what that organisation is owing before the sale or the cost of selling it.”
The Federal Government in its efforts to reduce the cost of governance introduced a monetisation policy for public servants in 2002.
Under the monetisation policy, public servants, particularly in Lagos and Abuja, were encouraged to own houses by buying houses occupied by them, but owned by the Federal Government.